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Selected news articles which highlight important policy issues.

News: Weekly Archives

News for the week of 08-09-2004

Encore (A Special Report): HealthMiracle Cure? Medicare is bringing “disease management” to your door; Here’s what you need to know
Wall Street Journal, 8-9-04

As mandated by the 2003 Medicare Modernization Act, the Centers for Medicare and Medicaid Services has begun test “disease-management programs” in ten regions that aim to cut program costs and improve patient care.

“Medicare has traditionally focused on paying more when people use more services and have more complications - when they spend more time in the hospital getting intensive procedures”, said CMMS Administrator Mark McClellan. Through this new trial program, nurses will regularly communicate with about 30,000 patients in an effort to help seniors better understand and utilize the care they receive, as well as improving overall patient health.

The trial program takes its bearings from the fact that “the average Medicare beneficiary visits seven different doctors and fills many as 20 prescriptions each year” - creating myriad opportunities for waste and confusion between providers and patients.

Worse yet, standards of care vary widely - some studies have shown that patients with chronic conditions often do not receive the right tests and medications recommended for their illnesses. Medicare officials hope that, through effective patient education and follow-up, companies who participate in the program can produce savings of 5% or more compared to what Medicare would normally spend. If a company misses the savings target it won’t get paid. “We’ll be surveying patients and providers involved to see what they think of the program”, said Dr. McClellan.

The bottom line: Medicare is trying to give providers the right incentives to coordinate patient care and reduce expenditures at the same time. This is exactly the kind of visionary reform American health care desperately needs.

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Fake-Drug Sites Keep a Step Ahead - One Is Busted for Selling Bogus Pharmaceuticals; New Vendor Grabs Address
Wall Street Journal, 8-10-04

Five federal agencies - including the FDA, FBI, and IRS - worked together to dismantle a large Internet drug counterfeiting operation, WorldExpressRX.com. The counterfeited drugs in question - which often contained “too much active ingredients”, making them a health hazard - were manufactured in places like India, and smuggled into the U.S. through Mexico.

This is only, however, a single needle in a very large haystack. In the battle against internet counterfeiters, the federal agencies are up against an agile, technically sophisticated foe operating from foreign shores. Indeed, the profit margins in counterfeit drug trafficking are so large that legitimate Internet drug vendors often shift to counterfeiting after selling legitimate drugs. As long as the U.S. has an enormous appetite for less expensive prescription drugs, counterfeiters will be drawn into the market in droves.

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Strep-Throat Vaccine Passes Early Clinical Tests
Wall Street Journal, 8-11-04

Good news - but not good enough. The Canadian firm ID Biomedical Corp. has produced a strep-throat vaccine that has been shown be effective and safe in early clinical trials. This is good news since researchers have been trying to develop a safe strep vaccine for decades; research on an earlier vaccine was halted in the 1970s after test subjects developed rheumatic fever. In the wake of its successful Phase I and II trials, Biomedical will ask for FDA approval to begin testing the vaccine in children in early 2005.

This is where the good news ends. The vaccine still faces a steep uphill struggle to clear stringent regulations. As a result, the vaccine won’t reach market at least until 2009 - after much larger studies have been conducted with as many as 60,000 people. The enormous cost of drug development hinders vaccine and anti-infective research much more than other biopharmaceutical products - the market for vaccines and antibiotics is normally much smaller than for other products, and much more vulnerable shifts in government policy. As it is, the pipeline for new vaccines and antibiotics is worrisomely low. Streamlining the process would disproportionately benefit the public health - and should be a top FDA priority.

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Health Plan That Cuts Costs Raises Doctors’ Ire
The New York Times, 8-11-04

In northwest Washington State, Whatcom County has started an innovative program that lowers costs by, among other things, “assigning nurses and creating electronic records for some patients.” The county also hopes that improved patient care will come as a result of standardized patient filing, better tracking of prescription drug utilization, and frequent follow-ups with patients to ensure that they are complying with physicians’ instructions.

Why haven’t health care providers done this before? The incentives in the American health care system all subsidize health care use - not health care quality. A case that is managed badly - resulting in increased hospitalizations or emergency room use - is more heavily compensated than cases where providers are proactive and keep their patients out of the doctor’s office. In other words, we reward waste and penalize high-performing, innovative health care institutions.

We can only hope that this program, and similar Medicare trial programs, are the leading edge of a coming revolution in American health care.

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LIABILITY LAWSUITS Can FDA seal be broken? A fight is raging on whether agency’s approval of medical devices or drugs can prevent litigation
Newsday, 8-11-04

The problem with state tort claims conflicting with FDA regulations arises from the fact that firms that distribute products for national markets have no way of avoiding jurisdictions that allow rogue jury verdicts.

If one state allows jury verdicts that can bankrupt a drug or device manufacturer, but 49 other states and the federal government do not, that one state can still effectively set regulatory policy for the entire nation. The FDA has adopted the commonsense policy that variations among state tort laws - or between juries in individual states - should not be allowed to set national regulatory policy for medical products. This stance may not be popular with trial attorneys - but it is the right one.

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FDA Approves Drugs to Treat Internal Contamination from Radioactive Elements
FDA News, 8-11-04

In order to better protect the public health in the event of a terrorist attack using radiological dispersal devices (aka “dirty bombs”), the FDA has approved two new drugs for treating radiation exposure: pentetate calcium trisodium (CA-DTPA) and pentetate zinc trisodium (Zn-DPTA). The FDA says that both drugs are “safe and effective for treating internal contamination with plutonium, americium, or curium.”

These compounds have been used as “investigational drugs” for treating patients in radiation contamination emergencies for decades prior to official FDA approval. The impetus for the approval was the FDA’s announcement in September 2003 of a specific set of findings that would allow the drugs to be approved through the new drug application process.

The FDA’s foresight and aggressiveness in promoting medications to treat acts of terrorism and bioterrorism has been, and remains, encouraging. Hopefully, the passage of the Bioshield Act will lead to flood of similar applications.

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Medicare Drug Benefit Fails to Boost Bush, Survey Finds
Washington Post, 8-11-04

The Kaiser Family Foundation and the Harvard School of Public Health have released a new survey showing that seniors view the Medicare prescription drug benefit negatively. Out of the 1,223 participants in the survey, 47 percent had an unfavorable view of the law, 26 percent had a favorable view, and 25 percent didn’t know enough to have an opinion. Still, most respondents did say that they thought the program would benefit low-income seniors and seniors with expensive drug bills - although they didn’t expect to benefit personally.

Evaluating the drug benefit at this stage, however, seems unlikely to reveal anything useful about the true value of the program since the primary benefit (actual drug coverage) won’t take effect until 2006. By then the election will be over and the “muddle” surrounding the drug discount cards will have evaporated. At that point, seniors may have a very different impression of the program.

Still, seniors’ much discussed preference for legalized Canadian drug importation or having Medicare “negotiate” with pharmaceutical companies won’t change until there is a real national debate on these issues. We hope that such a debate will be forthcoming soon.

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UA officials discussing proposed drug institute
Associated Press Newswires, 8-11-04

America's system of pharmaceutical and biotech innovation is the envy of the developed world – largely because America's patent system encourages academia to work with government researchers and private companies in the search for new medicines. The University of Arizona is one academic institution that wants to join this trend by working with the FDA to establish a drug institute on campus that would help the university guide new medical technologies from the lab bench to the bedside.

The FDA's work with the U of A is part of the FDA's "desire to speed the drug approval process by offering 'translational research' – and, bottom line, patient health can't be improved without better products reaching the market.

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Donor Mistrust Worsens AIDS In Zimbabwe
The New York Times, 8-12-04

Zimbabwe's government under President Robert Mugabe has become increasingly corrupt, repressive, and violent in recent years – and NGO's and other international humanitarian organizations have found it harder and harder to work with the government without abetting its corruption.

Still, Zimbabwe is in the midst of an astounding AIDS crisis – with estimated 1.8 million people infected with HIV out of a population of 11 million; 360,000 people may need antiretroviral drugs now, while only a tiny fraction of that number can afford them. Should aid organizations withhold funding from Zimbabwe's people on account of the sins of its government?

This is a hard question. But it should also be noted that there isn't an infinite amount of AIDS funding to go around, and offering aid to countries that are more responsible – and effective – with that funding will save more lives in the long run.

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THE COLOR OF MONEY: Web Pharmacies Can Endanger Your Health and Wallet
Washington Post, 8-12-04

How can consumers tell whether or not an online pharmacy is legitimate? Answer: not easily. According to a survey conducted by the National Consumers League "most consumers purchasing prescription drugs over the internet don't know how to tell whether the drugs they get are legitimate." This finding parallels an earlier report by the General Accounting Office that many Internet pharmacies had questionable – if not downright illegal – business practices. Finding legitimate online pharmacies is certainly possible, but the savvy and growing technical skill of Internet counterfeiters makes ordering drugs online a risky proposition.

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Canadian pharmacies fill U.S. orders overseas
Star Tribune, 8-12-04

Drug makers have cut back on shipments to Canada in order to retain their ability to offer different prices in the U.S. and Canadian markets – in response to Canadian price controls and differing exchange rates. As a result, "in the past two months, at least five Canadian firms have arranged to fill U.S. orders for prescription drugs through pharmacies in Israel, Chile, Australia, England, France, Germany, New Zealand, Switzerland, Denmark, and Italy." Officials from the Canadian International Pharmacy Association have expressed concerns that pharmacies that ship drugs from far-flung suppliers are risking Canada's reputation for drug safety by relying on importers that may not meet Canadian standards.

The reality, though, is that if the U.S. legalized drug importation tomorrow and forced pharmaceutical companies to sell drugs to all comers this situation would worsen rather than improve. Widespread U.S. drug importation would send Canadian importers rushing to find cheaper suppliers to maximize their profits – and that means that Europe, South America, and Asia would all become prime suppliers for the American market in short order. If Canadian pharmacists have concerns about some of these suppliers, perhaps Americans should too.

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FDA worries that drugs could be a target for terrorists 'Chatter' hints at contamination of Canadian imports
Houston Chronicle, 8-15-04

Acting FDA Commissioner Lester Crawford has warned the nation that terrorist "chatter" gathered from around the world shows that terrorists are at least considering the possibility of poisoning America's domestic food or drug supply, "particularly illegally imported prescription drugs." Although the FDA and other federal agencies have long cautioned consumers that there is no way for regulators to guarantee the safety of drugs imported from abroad, this is the first official statement that terrorists are actively considering this as an avenue of attack.

Of course, terrorist "chatter" may be nothing more than idle talk – terrorists and their protégés undoubtedly consider a wide range of attacks, the vast majority of which never occur. Still, GAO and the FDA have uncovered ample evidence in recent months that drug importation is vulnerable to routine fraud and counterfeiting by unscrupulous firms – whether or not terrorists ever learn how to exploit these loopholes they are still there and we must learn how to close them.

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State prescription drug buying club not taking off as planned
Associated Press Newswires, 8-15-04

The government's prescription drug discount program is hitting some bumps in its early going. Some seniors find it confusing and hard to navigate. Critics allege that discounts in the program may not be as large as the government originally promised. Enrollment in the program is only a fraction of government estimates, and continues to lag despite the best efforts of government officials.

The Medicare discount card program? Hardly. The preceding description applies to Illinois's prescription drug buying club, touted by Governor Rod Blagojevich as a better alternative than its Medicare cousin. State officials had said that the program would help more than 1 million seniors and other residents save money – thus far, less than 14,000 seniors have paid the $25 annual fee to join the program.

We won't begrudge state officials their optimism regarding the future of their program while they are still working out its kinks – we only ask that they offer a similar courtesy towards the Medicare program.

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